For the New Year we figured we'd offer you something to help you think about your future. Over the past two years Jan and I have been talking about and planning for Financial Independence and Early Retirement (FIRE). Since we're working this out over time and have a blog, we decided to bring you in on the process. This will be a serialblog submission as we develop the plan, work toward and hit our milestones, and then get on our way. A lot of thought has already gone into this, and a lot more will go in as we build and implement our plan.

So first, the basics. What is FIRE anyway? FIRE is a way to spend what time we have doing what we most want to do. It's that simple. This can be done anywhere in the world, including the United States, although costs will vary by location. It costs a lot more to raise two kids in the DC area than it does in rural Nebraska, Ecuador, Vietnam, or Spain. Therefore, FIRE often involves heading away from past jobs, maybe abroad, which is great for us as that's something we want to do anyway.

Beyond the where and what, you probably want to know what it's not. FIRE is not, at least for us although it could be for others, hanging out at a golf club every day until we die. What it means for us is focusing on raising our kids by spending time with them. Beyond the time with kids, because at some point they will have enough of us, it means writing, volunteering, teaching, and maybe even building something. It does not mean that we're all done working for our lives because who could say that this early on? Instead, it simply means that we don't have to work during this time, but if we get paid for what we're doing that's cool.

You can already see, this is not the traditional definition of Retirement. FIRE is freedom to choose how you want to live and earn your money. It can easily be part of your Retirement Planning, as we discussed in this post. It does involve a level of spending lower than the one required to live where we currently live, but with geographic arbitrage, we're not concerned about losing any lifestyle. We can live on less than half of what we spend every month and live like kings in most of the world. Since we don't need to live like Kings, we can actually spend about 1/3 to ¼ of what we currently spend and be just fine. Since we don't spend that much already, we're well on our way to raising our kids ourselves and doing what we want with the time we have with them.

Where we stand now

As of today here's where we stand on FIRE:

We have a broad 18-36 month plan (the length of time is based upon the needs of our adopted child. Once we know more about who we will be adopting and how we can integrate them into our lives and offer them the best life we can, we'll solidify the plan more.) We could go today, but adoption is a priority for us. Therefore, we'll stay here for the time necessary to carry out the adoption, ensure that the children are prepared, and then head out. This is a family adventure, so we all have to be onboard.

Our plan requires that we have at least $400,000 of net worth (see, not high by U.S. standards, but great by international standards!). This is based on the very well proven 4% rule of retirement withdrawal rates so that we can have a reliable $16,000 per year for our family of 4. That's far below the U.S. poverty line, but well above the line in many areas of the world. We're already at this milestone, so anything we save from today on is added to the pot, providing more runway and dividends to live off of in the future.

Beyond that, we are building this blog, Jeremy's personal writing, and some other projects that we intend to bring at least $8,000 a year within 5 years. (Not too ambitious, right! We have 5 years of living on our savings, before we have to make a dime!) At that point, if we're not making enough we can stay abroad, come back to the U.S. and get any job we want to make up the difference in cost of living, or find something else to do, like open businesses to bring in the cash.

Locations we're most interested in:

Spain andUruaguay for our initial phase of FIRE. (Oh, we didn't mention it could be in phases. Yeah, we're trying this out, right. So, let's try one place, see how it works. Then, try another, see how it works. Then, as the kids get older and more capable, try some more challenging places and see how they work. Nothing is set in stone. We're all just learning anyway!) The reason we're looking at these two places most is the greatly reduced cost of living as compared to the U.S., the very well established and safe environments they offer, the great health care and education opportunities available in each, and the ease with which one can return to the U.S. if need be from either. Not to mention, they are both located within easy distance of many other fantastic places to visit and teach kids about the world, so would be awesome hubs from which to launch new adventures.

We have some longer-term plans as well, but let's not get ahead of ourselves. We have to see if this works first. Therefore, let's talk about the short-term. We're going to give ourselves a FIRE Trial this coming summer.

We are going to use some travel miles points that we earned after taking a free course at Travel Miles 101 to fly to Spain at the end of July. We'll then settle ourselves down in/around Alicante Province for a month, seeing how we do with just one month abroad. Can we find our way around? How does Joshua adjust to living abroad? Can we find healthcare when we need it? Are we able to figure out travel to Paris, Sete, Fez, and Barcelona? This will be our chance to discover if this is a good idea for us in a safe environment that is not too different than what we're used to in the U.S.

LifeisComfy is for informational and entertainment purposes only. We are not financial professionals.

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